Polygon (MATIC) Holds Strong Above $0.50 Support Level
Polygon (MATIC) has managed to stay above the crucial $0.50 support level while altcoins outperformed Bitcoin (BTC) over the weekend. However, there are concerns about whether investors will hold on long enough to support further price recovery for MATIC.
Renewed Network Activity Fuels MATIC Recovery Attempt
Confidence is slowly returning to the Polygon ecosystem as MATIC’s price bounces back from its low of $0.48 in 2023 and reclaims $0.52. On-chain data suggests that the recent increase in Polygon network activity is driving the ongoing price resurgence. The number of transactions recorded on the Polygon network reached a 50-day high of 4,621 on September 22.
Tracking daily confirmed transactions gives an estimate of economic activity on a blockchain network, indicating demand for the native token. As a result, MATIC’s price has seen an 8% increase and currently sits at $0.51 as of September 25.
Investors Holding Their Tokens
After Binance announced it would delist Polygon-hosted assets from its NFT Marketplace on September 26, MATIC holders moved 3.5 million tokens into exchanges within 72 hours of the announcement. This brought the total number of MATIC tokens in exchange-hosted wallets to 983.7 million.
Despite the price increase since September 11, MATIC exchange reserves remain at 982.3 million tokens. This suggests that investors may be waiting for more favorable prices to sell rather than holding for a prolonged recovery.
Possible Price Correction for MATIC
The stagnation in Polygon network activity and the high exchange reserves could lead to a price correction for MATIC. Additionally, the market reaction after Binance discontinues support for Polygon on its NFT marketplace on September 26 will be closely monitored.
MATIC Price Prediction: Potential Drop to $0.45
If MATIC loses the $0.50 support level, it could experience a significant drop to $0.45 before finding substantial support. The purchase price distribution of current Polygon investors supports this prediction.
If bearish sentiment intensifies, MATIC’s price is likely to drop as predicted. However, if bulls manage to overcome resistance levels, MATIC could break above $0.80 for the first time since July 2023.
Hot Take: MATIC’s Recovery Relies on Investor Confidence and Network Activity
Polygon (MATIC) has shown resilience by holding above the $0.50 support level and experiencing a price recovery. However, doubts remain due to paper-handed holders potentially undermining the recovery and the stagnation in network activity.
The recent increase in Polygon network activity has been a positive sign, but it remains to be seen whether it can sustain momentum. Additionally, investors’ behavior in holding or selling their tokens will heavily influence MATIC’s future price movements.
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